Jakarta, Indonesia, 26 March 2014—IFC,
a member of the World Bank Group, has advised the Provincial Government
of Jakarta and Indonesia’s Ministry of Law and Human Rights, on streamlining
business registration and licensing procedures – measures that aim to
improve Indonesia’s investment climate and attract more foreign investment.

IFC, the Jakarta government and the
ministry highlighted today recent reforms aimed at improving the ease of
doing business for Indonesian entrepreneurs. Improving investment climate
is among the Indonesian government’s top priorities as it develops the
country’s private sector to propel economic growth.

IFC has supported the ministry in improving
the processes related to establishing limited liability companies, enabling
the ministry to launch the so-called Ditjen AHU online system and issue
supporting regulations.

“The Ditjen AHU online system will
revolutionize the way we deliver public services,” said Freddy Harris,
Head of the Secretariat for the Director General of General Legal Affairs
with the Ministry of Law and Human Rights. “The public can now apply online
to reserve a company name and legalize the establishment of a limited liability
company. These procedures used to take more than a week. Now they can be
completed online in a matter of minutes.”

IFC has also supported the Jakarta government’s
efforts to streamline business registration and licensing, leading to the
enactment of rules regulating so-called one-stop shops where businesses
can take care of numerous government approval procedures at a single location.
The new regulation allows one-stop shops to process and issue licenses
directly rather than merely serving as a front office with the approval
authority still lying with the technical agencies. For example, general
trading licenses (SIUP) and business registration certificates (TDP) can
now be processed and issued within three days.

“The new regulation marks a new chapter
in licensing simplification in Jakarta,” said Denny Wahyu Haryanto, Head
of the Organization and Procedure Bureau of the Jakarta Provincial Government.
“It will enable one-stop shops to provide more efficient services to the
public.”

The reforms by the two government agencies,
if implemented effectively, are expected to reduce the time needed to start
a business in Jakarta to 21 days, down from 48 days currently.

“We applaud the government’s efforts
in introducing reforms in Jakarta and nationally to remove red tape and
improve public services and the investment climate,” said Sarvesh Suri,
IFC Indonesia’s Country Manager. “We are confident that the government
will continue to push for more reforms to show its commitment to creating
a more competitive environment for businesses.”